Experts Urge FG To Incentivise Commodities Trading

Stakeholders of the Nigerian economy, on Tuesday in Abuja concluded a two-day International Conference on the Nigerian Commodities Market (ICNCM 2020), urging the Federal Government to incentivize commodities trading through the exchange, thereby impacting positively on the commodity ecosystem and economy.
As part of the recommendations at the conference with the theme: Commodities Trading Ecosystem: “Key to diversifying Nigeria’s economy,” experts also called for the provision of high-quality seedlings to farmers. This, they noted, is critical to boosting the quality of the harvest and in the long run increasing liquidity and competitiveness in the commodity market.
According to the communiqué at the end of the conference organized by the Securities and Exchange Commission (SEC), access to long-term funds through the Nigerian capital market was identified as critical towards the holistic development of the Agricultural sector.
Going forward the participants called for further discussions “around how the capital market could create long term funding for Agriculture and Agribusinesses”.
Participants agreed that Nigeria must decisively address the challenges across the entire gamut of the agriculture value chain in terms of access to finance by farmers, aggregation of smallholder farmers, storage, warehousing and transportation, the establishment of efficient irrigation mechanisms to ensure year-round farming, availability of effective de-risking frameworks and the introduction of modern scientific solutions as well as cutting-edge equipment for mechanized farming.
The regulator, on the other hand, was urged to remain an impartial enabler and promoter, providing a framework for exchanges, institutions, and participants in the commodities ecosystem to thrive.
According to the participants, “stakeholders need to ensure efficiency in the commodities ecosystem for securitization to be successful. This could be achieved by ensuring gaps in the value chain are addressed and responsibilities of addressing these gaps taken up by appropriate stakeholders.
“Nigeria must begin to adjust to the reality of the emergence of digital commodity exchanges that trade digital assets. Adaptable technology for the trading of commodities that addresses the needs of millennials should also be developed”.
In her remarks, Acting Director-General of the SEC, Ms. Mary Uduk while commending participants for a successful conference, said one of the key initiatives of the 10 year Capital Market Master Plan is the development of a thriving commodities trading ecosystem as part of the capital market’s contribution to the national economy.
According to her, while it is clear that Nigeria is well endowed with agricultural, metals and energy commodities, the. nation’s potentials in these areas are unrealized.

Photo caption: From left, CEO Nigerian Economic Summit Group, ‘Laoye Jaiyeola, CEO AFEX Commodities Exchange, Ayodeji Balogun, and Managing Partner, Trans Sahara Investment Corporation, Kyari Abba Bukar during the International Conference on Nigerian Commodities Market in Abuja, Tuesday.


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